WA businessmen play down impact of new tax on foreign investors

WA businessmen play down impact of new tax on foreign investors
April 06 11:30 2017 Print This Article

Updated April 06, 2017 21:52:33

Two of WA’s most influential businessmen, property developer Nigel Satterley and banker John Poynton, have played down the impact of the WA Government’s controversial tax on foreign investors.

Premier Mark McGowan announced the Foreign Buyer Surcharge — a four per cent tax on residential property purchases by overseas investors — during the recent WA election campaign.

Mr McGowan said it would be introduced in 2019-20 and raise $21 million in its first year, which would be used to fund a freeze on TAFE fees.

It could be a useful revenue source, given today’s announcement by Treasurer Ben Wyatt that state revenue was forecast to drop by $1.2 billion over four years.

Mr Satterley and Mr Poynton said the tax would not have a dramatic effect because of the slow WA economy.

“[There will not be] a great impact because there’s not a lot of interest in buying residential property for investment from Asia in Perth,” Mr Satterley said.

“Perth’s in a technical deep recession, 200 families a week are leaving Perth, there’s an oversupply of everything.”

Mr Poynton said foreign buyers attracted by Perth’s cheaper housing market in a subdued economy, compared to Melbourne and Sydney, might think twice.

“I can understand why a government would want to do it,” he said.

“I would suggest there are other easier places to look rather than putting another tax on economic activity.”

Their measured comments stand in contrast to condemnation of the tax by the property industry’s peak bodies.

The Housing Industry Association has called it “a retrograde step”, the Property Council of Australia said it was a “dumb idea” which would have “dire ramifications” for the economy, while the Real Estate Institute of Western Australia said it was an “example of politicians bleeding property for political point scoring”.

Mr Satterley was hopeful that he could get Mr McGowan to change his mind on the tax, once his Government had “settled in”, because it sent the wrong message to Asian investors.

“So hopefully there’s going to be discussion with the industry on the merits of doing it or not doing it and hopefully it will be taken away,” he said.

Both Mr Satterley and Mr Poynton have been closely involved with the Liberal Party, but relations with the Barnett government soured during its last term.

Along with property developer Greg Poland, they funded a private poll last August which suggested the government was likely to lose the election with Colin Barnett as leader.

Topics: tax, state-parliament, wa

First posted April 06, 2017 21:30:35

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Scott Menard
Scott Menard

He is a leading authority on business trends including ‘big data’, self-employment and the social media revolution. He’s the author of the award-winning book, Marketing Shortcuts for the Self-Employed (2011, Wiley) and a regular speaker for Bloomberg TV. He has spoken about global mega trends, big data and the social media revolution at conferences and business events around the world .

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